Doing the (political) math

In a couple of TV spots and a radio ad touting his recent legislative successes, Gov. Rick Perry says the new property tax cuts will save the average Texas homeowner $2,000. That is based on a three-year calculation for a $180,500 home, the average sales price in Texas in March, according to the governor’s campaign. But it is still more savings than many Houstonians will realize.

The governor’s claim is computed like this: $180,500 minus the statewide $15,000 homestead exemption leaves a taxable value of $165,500. Trimming 17 cents per $100 of value off that amount this fall saves $281.35. Trimming 50 cents per $100 value for 2007 and 2008 equals another savings (at least on paper) of $827.50 for each of those years for a total cumulative savings (compared to 2005 taxes) of $1,936.35. Yes, the governor rounded up, and, some people will point out, didn’t take into account the potential effects of rising property values. But these are political ads, folks, not math lessons.

The savings for the average homeowner in the Houston Independent School District will be significantly less. The average taxable value of a house in HISD, minus homestead exemptions, is $117,227. The cumulative, three-year tax savings on that house (compared to 2005 taxes) will be $1,254. And, again, rising property values aren’t part of the equation. Then, there are the new business tax, the higher cigarette tax, etc. And renters, who account for more than half of Houston’s population, aren’t guaranteed any pass-throughs of their landlords’ property tax savings.